Today the Department of Labor & Industries proposed increasing average workers’ compensation rates by 4.9% in 2027. According to L&I, rates would increase for 293 of the state’s 327 risk classes.

As shown in the chart above, the proposal for 2027 would be the sixth increase in a row. However, these increases have not been high enough to cover claim costs. As L&I noted in its proposal today, “The agency would use funds from the workers’ compensation contingency reserve to cover the potential difference between what the rate increase will bring in and what projected costs will be.” The break-even average rate increase for 2027 would be 18.2%. (Meanwhile, L&I says that it “keeps a lower contingency reserve than other workers’ compensation insurers.”)

Although this policy of setting rates below the break-even point helps to prevent large swings in rates, it hides the true cost of Washington’s workers’ compensation system. Workers’ compensation benefit costs in Washington continue to be the highest in the country.